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. Last Updated: 07/27/2016

Report: KBC to Sell Absolut Bank

Belgian banking group KBC will sell Russian lender Absolut Bank to a private pension fund managed by Russian Railways, sources close to the deal said Tuesday.

The deal will be announced officially in mid-December, Vedomosti reported, adding that the Central Bank has already been preliminarily consulted on the matter.

According to the source, the Blagosostoyanie pension fund could pay up to 12 billion rubles ($387 million) for 100 percent of the lender, which has a market capitalization of 19.4 billion rubles.

Yury Novozhilov, administrative director of Blagosostoyanie, KBC and Absolut Bank all declined requests for comment.

Reuters reported that selling Absolut Bank would allow KBC to unlock 7 billion euros ($9 billion) of state aid agreed at the height of the 2008-09 international financial crisis, when the banking group received a bailout from the Belgian government and the Flanders region.

KBC's acquisition of Absolut Bank in 2007 was a record-breaker on the Russian banking market. The bank was valued at four times its capitalization and came in at $1 billion.